RealTime IT News

iVillage Faces Delisting from NASDAQ

Hard on the heels of TheGlobe.com's delisting from The Nasdaq Stock Market, women's portal iVillage Inc. has received a compliance notice warning it of the same fate.

In the notice, Nasdaq informed iVillage that its common stock had failed to maintain a minimum bid price of $1.00 for 30 consecutive trading days as required by The Nasdaq National Market under Marketplace Rule 4450(a)(5).

iVillage -- a media portal that targets women -- will have until July 19, 2001, or 90 calendar days, to regain compliance with Nasdaq's continued listing requirements.

While the warning comes as no surprise, the realization that the shoe has finally dropped for a well-known, long-standing Alley play sent shock waves across the New York metro area.

Pundits familiar with the situation said it was particularly difficult to witness iVillage's Nasdaq predicament, particularly because the company has a long history in the Alley. People familiar with the situation agreed that iVillage had taken the usual steps to edge away from the delisting brink.

Like many dot-coms, iVillage has taken action within the last year to remain buoyant in a tech marketplace that has witnessed a decline in advertising spending and has pummeled most Internet companies, including online gaming community TheGlobe.com, which was delisted yesterday.

In July 2000, iVillage switched its focus from retailing to shoring up its media content. The company closed its iBaby ecommerce division and confirmed that the expertise needed to operate a retail outfit with an out-of-state warehousing operation was, simply put, beyond its know-how.

On April 19, atNewYork.com reported that iVillage laid off 30 employees and reaffirmed first quarter guidance that its fourth quarter revenue decline would not exceed 35 percent.

The six-year old company, which operates Lamaze Publishing and the Newborn Channel currently has about 319 employees.

In a statement, the company said it believes several pending actions can still place it in good standing with the Nasdaq.

Those actions include its acquisition of Women.com, which includes a $20 million investment from The Hearst Corporation and/or Women.com's other stockholders upon completion of the acquisition, and Hearst's commitment to purchase $15-21 million in advertising and production services over three years.

"[This] will strengthen the company's competitive position and increase its attractiveness to new sponsors," iVillage said.

While Hearst may be willing to spend big dollars to bring advertisers on-board, the challenge for iVillage, and others, will be to find those advertisers who are fast fleeing to offline properties.

In early morning going, shares in iVillage were trading at 80 cents, 5 cents off its open at 85 cents and well-below its 52-week high of $16.00.